FIVE-MINUTE SALES PITCH
Salesforce.com Looks Beyond CRM

Over the past year, Salesforce.com (NYSE: CRM) has launched a number of products, including applications for both the high and low end of the CRM market, and offline and mobile editions. Early next year, the company will roll out a billing product that will include contract management and order management features. CRM Buyer Magazine spoke with Salesforce.com CEO and chairman Marc Benioff about his company's plans to expand beyond CRM in the coming year and his take on the market in general.

Benioff said that when he founded Salesforce.com in 1999, he knew he would have to take on Siebel eventually -- even then, Siebel dominated the CRM space. What he did not know, he said, was that he should have done it right away.

"It was one of our mistakes, not going head to head with them from the beginning," he told CRM Buyer. But after about a year of concerted effort -- not to mention at least two major advertising campaigns -- Salesforce.com claims it has won over a number of former Siebel users.

All in all, the strategy has paid off handsomely, Benioff said. "We are the fastest growing CRM company in the market today. Our revenues have increased from zero in 1999 to over US$100 million in 2003."

365 Days and Counting

CRM Buyer: Where do you see Salesforce.com a year from now?

Benioff: Within a year, we will be offering an even broader range of customer-facing applications in sales, marketing, customer support -- as well as collections management and order processing. Right now we have over 5,400 customers and 72,000 paying users. In a year, we'll have more than 10,000 customers.

We'll also be concentrating more on Asia, entering new markets, such as China. In fact, we recently released Chinese and Korean language versions of Salesforce.com in anticipation.

The short answer, though, is that in a year we will have continued to strengthen our already-strong position.

Shifting Strategies?

CRM Buyer: I've noticed Salesforce.com has started highlighting client wins against SalesLogix in its press releases lately. Is that a shift in strategy for you?

Benioff: No, it's just something we haven't talked about as much previously. We've done incredibly well illuminating the converts we made from Siebel. Now we want to talk about the clients we have converted from SalesLogix.

Competing for Market Share

CRM Buyer: Isn't Salesforce.com more likely to come across SalesLogix -- or for that matter, Upshot -- in a deal than Siebel? In another words, aren't most of your users small and mid-size companies?

Benioff: Definitely not. Our users and revenue are evenly distributed between the small, mid-size and large markets. We are getting customers from all segments of the marketplace. They don't like ACT!, they don't like SalesLogix or Siebel, so they come to us.

CRM Buyer: Are those your three main competitors then?

Benioff: Yes.

CRM Buyer: Does that mean when Microsoft (Nasdaq: MSFT) CRM enters the market it might be beneficial for Salesforce.com -- given that most analysts say ACT! and SalesLogix are likely to be impacted by it sooner or later?

Benioff: I don't know if it is true that ACT! and SalesLogix will be affected. Personally, I think Onyx (Nasdaq: ONXS) and Pivotal will be the ones to feel the heat.

The End of Software

CRM Buyer: I asked you what was one thing you felt you did wrong since founding Salesforce. So fair's fair, what is one thing you know you've done right?

Benioff: Making it clear we are about the end of software.